Forecasting And Balanced Scorecard: Choose An Item That You

Forecasting And Balanced Scorecardchoose An Item That You Would Like T

Forecasting and Balanced Scorecard Choose an item that you would like to manufacture. You do not actually need to manufacture something, but will proceed through the assignment as if you were planning on manufacturing the item you have selected. The product should require materials and labor and be something that you are familiar with in process from start to finish. The product must be useful and marketable. You can choose something as simple as making chocolate chip cookies, a type of craft, or something more complicated.

Consider production as if you were making the product from beginning to end, and not as if using a kit. Perform the following steps: Choose a product to manufacture and describe the manufacturing process. Forecast the variable cost per unit. Forecast manufacturing costs and selling and administrative expenses as either variable or fixed. Prepare a contribution margin income statement separating all variable and fixed costs into their own categories.

Determine the breakeven point in units and dollars. Also, determine the number of units and dollars that need to be sold to make a target profit of $5,000 a month. Identify what types of trends you should be aware of in the industry and who the primary competitors are. Develop a balanced scorecard for a company that will sell your product, indicating two financial, two internal business process, two customer, and two learning and growth key productive indicators that will serve as the basis for your product strategy. Based on your costing scenario and information gathered from items 1-6, develop viable targets for these key productive indicators.

Name an initiative the company can take to ensure the target is met. Your final project should be in the form of a PowerPoint presentation that addresses each of these different areas. Steps #1-5 will involve numerical calculations and 6-7 should be put into the form of a table in proper format and included as part of the presentation. You should show any summary calculations in a table within a slide. Your submission should be 7-8 slides and follow APA requirements, including a properly formatted references slide. You should also cite at minimum 5-6 references.

Paper For Above instruction

The assignment entails a comprehensive planning process for manufacturing a selected product, integrating forecasting and balanced scorecard methodologies. This includes selecting a marketable product, detailing its manufacturing process, estimating costs, analyzing profitability, identifying industry trends and competitors, developing a strategic balanced scorecard, and proposing initiatives to meet targeted performance indicators. The final output is a PowerPoint presentation synthesizing all these elements into a cohesive strategic plan, supported by numerical data, strategic indicators, and scholarly references.

This paper illustrates a hypothetical scenario of manufacturing artisanal candles, a popular marketable product known for its aesthetic and functional appeal. The chosen product requires raw materials such as wax, wicks, fragrance oils, and decorative containers, alongside labor for melting, pouring, scenting, and packaging. The manufacturing process involves several steps: procurement of raw materials, melting wax, blending fragrance oils, pouring into molds or containers, curing, and packaging for sale. This process demands careful cost estimation and process management to ensure profitability and competitive positioning.

Forecasting variable costs per unit involves calculating costs related directly to production, such as raw material costs per candle, labor wages per batch, and packaging expenses. Estimations based on supplier quotes and labor time studies suggest a variable cost of approximately $3.50 per candle. Fixed manufacturing costs include equipment depreciation, rent, and utilities, estimated at $2,000 per month, while selling and administrative expenses encompass marketing, salaries, and other overheads, forecasted as fixed costs totaling $1,500 monthly.

A contribution margin income statement reveals that with a selling price of $15 per candle, the contribution margin per unit is $11.50, after subtracting the variable cost. Fixed costs total $3,500, leading to a breakeven point calculation of approximately 304 candles or $4,560 in sales revenue. To achieve a target profit of $5,000 monthly, sales need to rise to approximately 609 candles, or $9,135 in revenue.

Industry trends to monitor include the rising demand for eco-friendly and natural products, increasing consumer preference for artisanal and handcrafted candles, and seasonal fluctuations affecting sales. Major competitors include established brands like Yankee Candle and small local artisanal producers, emphasizing the need for differentiation through quality and branding.

A balanced scorecard for the candle company incorporates strategic performance indicators across four perspectives. Financial indicators include achieving a 20% profit margin and increasing sales revenue by 15% annually. Internal process metrics focus on reducing production cycle time by 10% and minimizing waste in manufacturing to under 2%. Customer indicators encompass increasing customer satisfaction scores to at least 85% and expanding customer base by 20% within a year. Learning and growth goals aim to enhance employee skills through quarterly training sessions and fostering innovation in new candle designs.

To support these targets, the company should initiate a continuous improvement program emphasizing lean manufacturing principles and employee engagement. Regular training and feedback systems can promote process efficiencies and innovation, ensuring strategic goals are met efficiently.

References

• Horngren, C. T., Sundem, G. L., Stratton, W. O., Burgstahler, D., & Schatzberg, J. (2014). Introduction to Management Accounting. Pearson.
• Kaplan, R. S., & Norton, D. P. (1992). The Balanced Scorecard—Measures That Drive Performance. Harvard Business Review, 70(1), 71-79.
• Drury, C. (2013). Management and Cost Accounting. Cengage Learning.
• Garrison, R. H., Noreen, E. W., & Brewer, P. C. (2018). Managerial Accounting. McGraw-Hill Education.
• Kaplan, R. S., & Anderson, S. R. (2004). Time-Driven Activity-Based Costing. Harvard Business Review, 82(11), 131-138.
• Higgins, R. C. (2012). Analysis for Financial Management. McGraw-Hill Education.